exv10w19






Exhibit 10.19




LEASE AND SUPPLY AGREEMENT




     THIS AGREEMENT (this “Agreement”), is made and entered into this 5th day of May,
2008, between Ready Mix, Inc, a Nevada corporation (“RMI”), and GILA RIVER LAKE, LLC, an Arizona
Limited Liability Company, d/b/a/ Buckeye Sand and Gravel (“Buckeye”).



WITNESSETH:




     WHEREAS, Buckeye is the owner of certain real estate located in Maricopa County, Arizona at
10423 South Apache Road, Buckeye, AZ 85326 on which Buckeye operates a construction aggregates
mining facility and more particularly described on Exhibit A, hereto (the “Property”); and



     WHEREAS, the Property has been designed to contain three separate sites or “pads” intended for
ready-mix concrete (“RMC”) plants and a hot-mix asphalt plant that will use Buckeye’s aggregates
products (collectively, the “Plant Sites”);



     WHEREAS, RMI wishes to lease one Plant Site consisting of approximately +/-4 (to be determined
upon completion of site plan) acres and shown on Exhibit B (the “Leased Premises”) for a period of
seven (7) years for the purposes of operating a RMC Plant (the “Plant”). and



     WHEREAS, RMI is contracting with Buckeye to purchase the aggregates necessary to operate its
Plant in accordance with the Purchase Order (PO) attached hereto as Exhibit C, and



     NOW, THEREFORE, For One Dollar and other good and valuable consideration and in further
consideration of the mutual covenants and agreements of the parties contained herein, the parties
intending to be legally bound hereby and agree as follows:



     1. LEASE.



     1.1 Grant. Buckeye hereby leases the Leased Premises to RMI for the purpose of locating,
erecting and operating the Plant and, to the extent necessary and incidental to the operation
thereof, the placing on the Leased Premises of fencing or other improvements and ancillary
equipment. Buckeye represents that it is the owner of the Property, including the Leased Premises,
and warrants to RMI quiet and peaceable possession of the Leased Premises under the terms of this
Agreement. All plant and equipment located on the Leased Premises by RMI shall remain the personal
property of RMI and shall not become part of the real property or otherwise the property of
Buckeye.



     1.2 Restrictive Covenant. RMI agrees not to operate a RMC Plant within (ten) 10 miles of the
Property during the term of this Agreement (the “RMI Restrictive Covenant”) without the express
written consent of Buckeye. Buckeye may at



 









 







its discretion allow RMI to operate a RMC Plant on a project specific basis, within (ten) 10
miles of the property, provided Buckeye retains the right of first refusal to supply coarse and
fine aggregate for that specific project.



     1.3 Potable Water Well. In the event RMI and/or proposed additional tenants install a potable
water well and pressure tank for use in its operations, Buckeye shall have the right to connect to
the water line leaving the pressure tank so that it can use the potable water at its office and
quality control facilities. There shall be no cost to Buckeye for the use of the water and there
shall be no cost to RMI and additional tenants for Buckeye’s connection and extension of water
lines to its facilities. If RMI proceeds with the installation of the potable water well and it is
sufficient to support two batch plants, Buckeye will require the second user to reimburse RMI for 1/2
(one half) of the development and construction costs of the potable water well, if and when they
connect to the well water.



     2. ACCESS. During the term of this Agreement, RMI and its customers shall have the
nonexclusive use of the existing private roads on the Property for ingress and egress in connection
with its activities hereunder provided such use does not unreasonably interfere with Buckeye’s
operations on the Property.



     3. TERM.



     3.1 Term. The term of this Agreement shall commence on May 5, 2008 (the “Effective Date”) and
shall continue for seven (7) years unless extended (the “Term”). In the event Buckeye is not able
to continue operations or extend its mining permit for any reason beyond the control of Buckeye,
the conditions set forth in Section 9 “Force Majeure” shall apply.



     3.2 Renewal Term. RMI shall have the right to renew and extend this Agreement for five (5)
additional one (1) year terms subject to negotiating annual material purchase agreements with
Buckeye prior to the expiration of the Term. Buckeye may terminate the lease after the expiration
of the 7th year if a development plan is submitted and approved by the Town of Buckeye or Governing
Agency to convert the upland part of the property owned by the Company to another use. Buckeye
shall give RMI six months written notice and pay the actual costs incurred by RMI to relocate its
concrete plant not to exceed $250,000. The maximum amount of the relocation cost will be reduced
by $50,000 for each one year option exercised by RMI.



     4. PRODUCT REQUIREMENTS.



     4.1 Minimum Tonnage. In partial consideration of the rights granted by Buckeye hereunder, RMI
agrees to purchase from Buckeye all of its requirements for fine and coarse aggregates for use in
the manufacture of ready mix concrete at the RMC Plant (the “Products”). On or before January 1 of
each calendar year during the term of this Agreement, RMI shall notify Buckeye of its expected
requirements for the next calendar year, including those requirements for Products for use in an
RMC Plant (the “Annual Minimum Quantities”).



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     RMI agrees that, commencing on January 1, 2009 and for each year thereafter as long as this
Agreement remains in effect, the annual payment Buckeye receives (the sum total of the twelve
monthly payments due and paid for each year of the Agreement) shall not be less than an amount (the
“Annual Minimum Payment”) calculated on the basis of the minimum annual combined sales of fine and
coarse aggregate and the price of Washed Fine and Coarse Aggregate during the year pursuant to
Exhibit C. Beginning on January 1, 2010 and thereafter as long as this Agreement remains in
effect, the Annual Minimum Payment shall be adjusted January 1 of each calendar year of this
Agreement based on the Adjusted Price for fine and coarse aggregate determined in accordance with
Exhibit C, Paragraph 2 hereof, provided, however, effective January 1, 2009, the Annual Minimum
Quantities shall not be less than 100,000 tons for the first 12 months of this agreement, 150,000
tons for the second 12 months of this Agreement and 200,000 tons for each 12 months thereafter.



     RMI agrees that commencing on January 1, 2009 and for each month thereafter as long as this
Agreement remains in effect, the Minimum Monthly Payment Buckeye receives shall not be less than an
amount calculated on the basis of the Monthly Minimum Quantity (as defined herein) and the price of
Washed Coarse and Fine Aggregate determined in accordance with Exhibit C, Paragraph 2 hereof.
Effective January 1, 2009, the Monthly Minimum Quantity shall not be less than 6,250 tons per month
for the first 12 months of this Agreement, 9,375 tons per month for the second 12 months of this
Agreement, and 12,500 tons per month for each 12 months thereafter. If in any month RMI’s payment
due is less than the Minimum Monthly Payment (“Monthly Overpayment”), RMI shall be given a credit
(“Monthly Overpayment Credit”) equal to the amount of the Monthly Overpayment and Monthly
Overpayment Credits may accumulate except that each Monthly Overpayment Credit shall have a term of
12 months. RMI may use any portion of accumulated unexpired Monthly Overpayment Credits to reduce
the amount of any future Minimum Monthly Payment, provided RMI’s purchases exceed the Minimum
Monthly Payment by an amount equal to or greater than the credit taken.



     RMI shall be obligated to purchase and Buckeye shall be obligated to sell and deliver to RMI
the Annual Minimum Quantities during the calendar year. In the event RMI fails to purchase the
Annual Minimum Quantities during such calendar year (other than due to Buckeye’s failure or
inability to supply such Products or due to a Force Majeure as provided in Section 9 below), RMI
shall pay to Buckeye, as liquidated damages, an amount equal to 25% of the price of each ton of the
Annual Minimum Quantity not purchased by RMI in such calendar year.



     RMI may at its option request Aggregates deliveries in any calendar year in excess of the
applicable Annual Minimum Quantity and Buckeye shall, if and to the extent it has the capacity to
do so, supply such aggregates to RMI; provided, however, that Buckeye’s obligation to supply
aggregates in excess of the applicable Annual Minimum Quantities shall be subject to any contracts
or commitments to third parties entered into by Buckeye with third parties following RMI’s notice
of Proposed Annual



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Quantities for such year. Subject to the Annual Minimum Quantity, Buckeye shall not be
obligated to provide RMI more than 40% of the total concrete aggregate and washed concrete sand
produced by Buckeye.



     4.2 Price. The price for the Products shall be as listed on Exhibit C hereto, subject to
escalation as provided in said Exhibit and payment shall be made on the payment terms as set forth
in said Exhibit.



     4.3 Delivery and Weights. The Products shall be delivered by Buckeye to stockpiles at
locations near the Plant. Measurement of materials used by RMI for payment purposes shall be made
by RMI. For material used in the production of ready mix concrete measurement shall be based upon
the quantities of coarse and fine aggregate as shown on the RMI’s computer printouts for the plant
located on the RMC Plant site.



     4.4 Quality. The Products sold and delivered under this Agreement to RMI shall satisfy those
specifications set out in Exhibit C hereto



     5. FINANCIAL ASSURANCE. RMI hereby acknowledges that Buckeye has provided financial
assurance to the State Mine Inspector in connection with an approved Reclamation Plan for mining
and ancillary uses on the Property. If additional financial assurance is required by the State
Mine Inspector due to RMI’s operation of a RMC plant on the Property, RMI will be responsible to
provide a bond or other form of financial guarantee satisfactory to the State Mine Inspector, at no
cost to Buckeye.



     6. COMPLIANCE WITH LAWS. RMI shall comply with all applicable laws in the conduct of
its operations hereunder, including without limitation those relating to environmental protection.
RMI hereby acknowledges that the Leased Premises are within the floodplain and/or floodway of the
Gila River and further acknowledges receipt of a copy of the mining permit from the Maricopa County
Flood Plain District.



     7. TAXES AND UTILITIES. Buckeye agrees to make payment for all real estate taxes on
the Property. However, RMI shall pay that portion of the real estate taxes attributable to the
Leased Premises when billed for same by Buckeye. RMI shall also pay when due all ad valorem taxes
assessed on any improvements or personal property located on or used in its operation of the Plants
on the Leased Premises. RMI shall pay all utilities, including but not limited to, electricity,
gas, and water, consumed by RMI on the Leased Premises in the operation of the Plants. If such
utility costs are not separately identified and billed to RMI, but are charged to Buckeye together
with those for the Property generally, RMI shall promptly reimburse Buckeye for those utility costs
attributable to RMI’s operations on the Leased Property. In addition, RMI shall reimburse Buckeye
for that portion of the cost of extending electrical service to the Property based on the
percentage of amperage allocated to the Plant.



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     9. FORCE MAJEURE.



     9.1 Force Majeure. Neither party shall be liable for damages for any delay or failure in
performance of this Agreement, other than to make payments due hereunder, resulting from acts of
God, including, but not limited to floods, storms, earthquakes, hurricanes, tornadoes, or other
severe weather or climatic conditions, acts of public enemy, war, blockades, insurrection,
vandalism or sabotage, fire, accident, wreck, explosion, strike or labor dispute, embargoes,
governmental laws, orders, regulations, or third-party transportation disruptions, which cause
interruption in the production of Products at Buckeye’s operations on the Property, the receipt,
use or consumption of Products by RMI at any Plant or the manufacture and sale of ready-mix
concrete by RMI from the Plant.



     9.2 Notice. The party experiencing an event of Force Majeure will send written notice to the
other party describing the nature of the Force Majeure, the estimated volume of Products expected
to be effected thereby and its expected duration. This notice shall be sent within 5 days of the
beginning of the event of Force Majeure and within 10 days of the end of such event.



     9.3 Duties. The party whose performance is affected by such Force Majeure shall, to the
extent practical through commercially reasonable efforts, remedy such condition with all reasonable
dispatch; provided, however, that neither party shall be required to settle or otherwise adjust a
labor dispute or challenge the validity of any act of a governmental agency. The affected party’s
obligations hereunder shall be suspended during the period of Force Majeure to the extent impaired
by such Force Majeure. RMI, during any period of Force Majeure suffered by it that reduces its
requirements for Products at the Plant, shall be to the extent of such reduction relieved of its
minimum obligations under this Agreement to purchase Products. Buckeye, during any period of Force
Majeure suffered by it that reduces its ability to supply Products, shall to the extent of such
inability be relieved of its obligations under this Agreement to supply Products and in such case
RMI shall have the right and option to purchase aggregates from other sources to meet its
requirements at the Plant until such time as Buckeye has cured such Force Majeure.



     10. INDEMNITY.



     10.1 Buckeye Indemnitees. To the fullest extent permitted by law, RMI shall defend (by counsel
reasonably acceptable to Buckeye) indemnify and hold and save harmless Buckeye, any affiliate of
Buckeye, and their respective managers, members, officers, directors and employees (the “Buckeye
Indemnitees”) from and against any and all losses, demands, damages, suits, administrative
proceedings, actions, expenses (including reasonable attorneys’ fees and experts’ fees and costs),
judgments, fines, penalties and any other liabilities of any nature (whether or not involving
personal injury or property damage), brought or had against any Buckeye Indemnitee, or suffered or
incurred by any Buckeye Indemnitee which in any manner result from, arise out of, or



5









 







concern the operations of RMI or its (or its agents’, employees’ or invitees’) use, occupancy
or possession of the Leased Premises or the Property.



     10.2 RMI Indemnitees. To the fullest extent permitted by law, Buckeye shall defend (by counsel
reasonably acceptable to RMI) indemnify and hold and save harmless RMI, any affiliate of RMI, and
their respective officers, directors and employees (the “RMI Indemnitees”) from and against any and
all losses, demands, damages, suits, administrative proceedings, actions, expenses (including
reasonable attorneys’ fees and experts’ fees and costs), judgments, fines, penalties and any other
liabilities of any nature (whether or not involving personal injury or property damage), brought or
had against any RMI Indemnitee, or suffered or incurred by any RMI Indemnitee which in any manner
result from, arise out of, or concern the operations of Buckeye or its (or its agents’, employees’
or invitees’) use, occupancy or possession of the Leased Premises, Property or Products.



     11. INSURANCE. Each party shall maintain, at a minimum, during the term of this
Agreement those insurance coverages set out in Exhibit D, attached hereto and incorporated herein
by this reference. Promptly following the execution of this Agreement and in no event later than
the commencement of RMI’s occupation of the Leased Premises, RMI shall cause a Certificate of
Insurance to be delivered to Buckeye, and Buckeye shall cause a Certificate of Insurance to be
delivered to RMI, confirming such coverage and stating that such coverage will not be allowed to
expire or materially reduced without thirty (30) days written notice to the other party.



     12. DEFAULT AND REMEDIES.



     12.1 Default and Cure. If a party (the “Defaulting Party”) fails to comply with any material
term or condition of this Agreement, the other party (the “Non-Defaulting Party”) may provide
written notice to the Defaulting Party stating the nature of such failure (the “Default Notice”).
If the Default Notice relates to (i) a failure by the Defaulting Party to pay any amount due and
payable to the Non-Defaulting Party and the Defaulting Party fails to pay such sum within 15 days
after receipt of the Default Notice or (ii) a failure by Defaulting Party to comply with any
material term or condition of this Agreement, other than the payment of money hereunder, and such
failure is not cured within 30 days after the Defaulting Party’s receipt of the Default Notice, or
in the event of a cure which requires in excess of 30 days to complete, if the Defaulting Party has
not commenced such cure within such 30 day period and thereafter does not diligently prosecute the
cure to completion, the Non-Defaulting Party shall be entitled to either suspend or terminate this
Agreement. If the default arises from a failure of Buckeye to deliver Products in accordance with
the terms of this Agreement, RMI (without prejudice to other rights and remedies) may in its sole
discretion purchase substitute aggregates from other sources unless and until the default is cured
as provided herein.



     12.2 No Waiver. No waiver by a party of any breach by the other party or any of such other
party’s obligations, agreements or covenants herein shall be a waiver of any subsequent breach or
of any obligation, agreement or covenant, nor shall any forbearance



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by a party to seek a remedy for any breach by the breaching party be a waiver by the non-breaching
party of any rights and remedies with respect to such or any subsequent breach.



     12.3 Rights and Remedies Cumulative, Consequential Damages. Except as provided expressly in
this Agreement, no right or remedy herein conferred upon or reserved to a party is intended to be
exclusive of any other right or remedy provided herein or by law, but each shall be cumulative and
in addition to every other right or remedy given herein or now or hereafter existing at law or in
equity or by statute. Neither party shall have any liability to the other under this Agreement for
any consequential or punitive damages (other than punitive or consequential damages claimed by a
third party against RMI or Buckeye arising from events or conduct constituting a breach of this
Agreement or other wrongful conduct for which such party is entitled to indemnification from the
other party under this Agreement).



     12.4 ATTORNEYS’ FEES. In any litigation or arbitration arising out of this Agreement,
the prevailing party shall be entitled to recover from the other party all costs and expenses,
including, without limitation, attorneys’ fees, paid or incurred by such party in connection with
such litigation or arbitration.



     13. CONDEMNATION. If the whole or any part of the Leased Premises shall be taken for
any public or quasi-public use under any statute or regulation or by right of eminent domain, or by
private purchase in lieu thereof, either party may terminate this Agreement and, in such event, RMI
shall not be entitled to any award of monies paid for such land as taken but shall be entitled to
any award that may be made in connection with its leasehold interest.



     14. SURVIVAL. Any obligation of either party under this Agreement, which arises out
of acts, omissions, or conditions occurring or existing prior to any expiration or termination of
this Agreement, shall survive said expiration, cancellation or termination, including without
limitation the indemnity obligations of Section 10.



     15. REMOVAL FROM PREMISES. Upon expiration or termination of this Agreement, RMI
shall have a period of 120 days from the effective date of the termination in which to remove from
the Leased Premises any and all material, debris, waste, machinery, equipment and other property
there installed or produced by it. In addition, RMI shall, at their sole expense, provide Buckeye
with a Phase I Environmental Site Assessment report, in accordance with American Society for
Testing and Materials (ASTM) Standard Practice E 1527-05 and acceptable to Buckeye, certifying that
the Leased Premises is environmentally clean to commercial lending standards. Any potable water
well and appurtenances installed by RMI shall become the property of Buckeye at Buckeye’s sole
discretion. If this Agreement is terminated due to a default by RMI, the base rent shall be $5,000
per month commencing on the date of the default and continuing until such time that RMI has vacated
the Property and certified the site environmentally clean as required herein.



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     16. NOTICES. Wherever in this Agreement, notice is required or permitted to be given
by either party to the other, such notice shall be in writing and sent by certified United States
mail, return receipt requested, postage prepaid, addressed as follows:



	 	 	 
	If to RMI

	 	Ready Mix Inc
 Robert A. DeRuiter, V.P.

4602 E. Thomas Road

Phoenix, AZ 85018

Telephone: (602) 957-2722

Facsimile: (602)-522-1911
	 
	 	 
	With copy to:
	 	 
	 
	 	 
	If to Buckeye:

	 	Gila River Lake, LLC

Attn: Howard Libby, General Manager

11200 Rockville Pike, S. 300

Rockville, Md 20852

Telephone: 301-881-9766

Facsimile: 301-486-0215
	 
	 	 
	With copy to:

	 	Rick Barnas

31482 Isle Vista

Laguna Niguel, CA 92677

Telephone: 301-655-1090

Facsimile: 623-399-1011






     Either party may change its address for notices by giving written notice to the other party as
above set forth.



     17. CONFIDENTIALITY, MEMORANDUM AGREEMENT. The parties agree to record a memorandum in
a form reasonably acceptable to each party to provide record notice of RMI rights and interests
under this Agreement in the Leased Premises and the Property. Such memorandum will not disclose the
financial terms of this Agreement (including the term, prices of Products and minimum tonnage
requirements). Upon termination or expiration of this Agreement, RMI shall upon Buckeye’s request
execute a notice of termination of such rights for recording purposes in a form reasonably
acceptable to both parties. Except as may be required by law or as provided in this Section, RMI
and Buckeye shall maintain the confidentiality of the terms of this Agreement.



     18. ENTIRE AGREEMENT. This Agreement represents the complete understanding between
the parties hereto, and supersedes all prior negotiations, representations or agreements, whether
written or oral, as to the matters described herein. This Agreement may be amended only by written
instrument signed by both parties. No



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requirements, obligations, remedy or provision of this Agreement shall be deemed to have been
waived, unless so waived expressly in writing, and any such waiver of any such provision shall not
be considered a waiver of any right to enforce such provision thereafter.



     19. ASSIGNMENT. Buckeye may at any time assign its rights and obligations hereunder
to any successor or lessee of the Property, provided Buckeye is not then in default and provided
such assignee agrees in writing to assume Buckeye’s obligations under this Agreement. RMI, with the
approval of Buckeye, which shall not be unreasonably withheld, may at any time assign its right and
obligations hereunder to a publicly traded business entity, provided RMI is not then in default and
provided such assignee agrees in writing to assume RMI’s obligations under this Agreement.



     20. RETURN OR EXCESS MATERIAL. Buckeye will provide a location for RMI to dispose of
leftover concrete. If requested by Buckeye, RMI shall place returned or excess concrete in a
location or pre-constructed concrete “form” designated by Buckeye for Buckeye’s use. RMI shall
contain all wash-out and truck wash water and the containment must meet all applicable
environmental laws and regulations. RMI shall obtain applicable permits as necessary.



     21. ARBITRATION. All claims or disputes between RMI and Buckeye arising out of or
relating to this Lease and Supply Agreement, or the breach thereof, shall be decided first by
mediation then by arbitration in accordance with the Arbitration Rules of the American Arbitration
Association currently in effect unless the parties mutually agree otherwise. Notice of the demand
for mediation and arbitration shall be filed in writing with the other party to this Agreement and
with the American Arbitration Association and shall be made within (3) months after the dispute has
arisen. The award rendered by the arbitrator or arbitrators shall be final, and judgment may be
entered upon it in accordance with applicable law in any court having jurisdiction thereof. Except
by written consent of the person or entity sought to be joined, no arbitration arising out of or
relating to the Lease and Supply Agreement shall include, by consolidation, joiner or in any other
manner, any person or entity not a party to the Agreement under which such arbitration arises,
unless it is shown at the time the demand for arbitration is filed that (1) such person or entity
is substantially involved in a common question of fact or law, (2) the presence of such person or
entity is required if complete relief is to be accorded in the arbitration, and (3) the interest or
responsibility of such person or entity in the matter is not insubstantial. The agreement herein
among the parties to this Lease and Supply Agreement and any other written agreement to arbitrate
referred to herein shall be specifically enforceable under applicable law in any court having
jurisdiction thereof.



     22. APPLICABLE LAW. This lease will be governed by the laws of the state of Arizona.



     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered
for and in their names by their duly authorized officers, all as of the day and year first above
written.



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	 	GILA RIVER LAKE, LLC d/b/a

BUCKEYE SAND AND GRAVEL

 	 
	 	By:  	 	 
	 	 	Richard E. Barnas, 	 
	 	 	Manager 	 
	 



	 	 	 	 	 	 	 
	ATTEST:

	 	 	 	Ready Mix Inc	 	 
	 
	 	 	 	 	 	 
	Name

	 	 	 	Name	 	 
	Title

	 	 	 	Title	 	 






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EXHIBIT A

PROPERTY




[attach map or legal description of Property]



Pending review



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EXHIBIT B

LEASED PREMISES




[attach map or legal description of Leased Premises



Pending review



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EXHIBIT C

PRICING AND SPECIFICATIONS




	 	 	 	 	 
	Product:	 	Base Price (per ton)
	Washed Concrete Coarse Aggregate
(suitable for use in ready-mix concrete)
	 	$	8.25	 
	Washed Concrete Fine Aggregate
(suitable for use in ready-mix concrete)
	 	$	8.25	 





1. All prices are delivered into the appropriate stockpile at RMI’s RMC Plant on the Leased
Premises. In the event Buckeye loads RMI’s bins from the stockpile then the Base Price paid by RMI
shall increase by $.35 per ton.



2. The Base Price for each Product shall be increased by the CPI or Western Region Index on January
1, 2009 and each January 1 each subsequent year of the lease. If this Lease is still in effect, on
January 1, 2015 and January 1, 2020 Buckeye shall have a sixty (60) day option to negotiate a new
Base Price. Any Base Price Change shall be effective as of January 1 of the adjustment year.




     Commencing on the first anniversary of the date of this Agreement and on each anniversary
thereafter, the prices for materials listed in Exhibit C hereof shall be adjusted for the next
succeeding year based on the following formula:



               PPIE



          IP x PPIB = Adjusted Price



     Where:



	 	 	 	 	 	 	 
	 

	 	IP
	 	=
	 	The initial price as listed in Exhibit C hereof.
	 
	 

	 	PPIE
	 	=
	 	Producer Price Index — Table 6 Commodity Code 1321,
construction sand, gravel and crushed stone, as published
by the U.S. Department of Labor, Bureau of Labor
Statistics, for January in the year just ending(2007?) ;
	 
	 

	 	PPIB
	 	=
	 	Producer Price Index — Table 6 Commodity Code 1321,
Construction sand, gravel and crushed stone, as published By The
U.S. Department of Labor, Bureau of Labor Statistics, for January
— Current Year






13









 





provided, however, that in the event that the quotient of said ratio (PPIE/PPIB) in any given year
is less than 1.00, then in such event, 1.00 shall be substituted for such ratio and utilized in the
formula for calculating the adjusted prices to be paid by RMI (i.e., the Adjusted Price shall never
be less than the initial price set forth in Exhibit C hereof).




          The Producer Price Index Table 6 Commodity Code is currently indexed to the base year 1982. In
the event of a change in base years during this Agreement, the Producer Price Index numbers used in
the calculation shall also be adjusted for relativity with one another with respect to the new base
year, if necessary, to proportionately adjust the price for the relative percentage change in the
index. In the event the Producer Price Index shall cease to be published, then Buckeye and RMI
shall agree upon another index to be substituted therefore, and if they are unable to agree upon a
substitute index within a reasonable time, such matter shall be determined by arbitration in
accordance with this Agreement.



3. Payments are net 30 days from date of invoice. The Price referred to herein excludes any
applicable taxes, fees or charges imposed by federal, state or local law, regulations or order. RMI
shall pay any and all applicable taxes, fees and charges now or hereafter imposed by federal, state
or local law, regulations or order with respect to the sale, purchase, use, resale, resale
transportation or handling of materials (exclusive of corporate franchise taxes or taxes imposed
upon or measured by the net income of Buckeye or severance taxes or similar taxes imposed on the
production or mining of aggregates). If RMI is entitled under any federal, state or local law or
regulation to purchase such materials free of any tax, fee or charges, RMI shall furnish Buckeye
proper exemption certificates to cover such purchase or purchases in advance of deliveries
hereunder.



4. All aggregates supplied under this agreement shall meet the following specifications:





	 	(a)	 	Aggregates for Ready Mix Concrete in compliance with ASTM Standards and MAG
(Maricopa Association of Governments)Specifications.






	 	1.	 	Washed concrete sand shall maintain a fineness modulus (FM) range
of 2.70 to 2.90 with a minimum sand equivalency(SE) value of 75.




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EXHIBIT D

INSURANCE REQUIREMENTS




Workers’ Compensation



     (including coverage for Occupational Disease)



Limit of Liability




	 	 	 	 	 
	Workers’ Compensation

	 	Statutory
	 	Benefits
	Employers’ Liability

	 	$1,000,000/$1,000,000/$1,000,000	 	 







Where allowed by law, the contractor or vendor’s Workers’ Compensation policy shall contain
a Waiver of Subrogation in favor of RMI.



Commercial General Liability




     (including coverage for Contractual Liability assumed by Contractor)



     Limit of Liability


     Property Damage/Bodily Injury $2,000,000 Each Occurrence



                   
                    
                     $2,000,000 General Aggregate Limit



“RMI and all of its affiliates (direct and indirect)” shall be named as an additional
insured on Buckeye’s General Liability policy with respect to those activities provided for
in the Agreement.



“Buckeye Sand and Gravel and all of its affiliates (direct and indirect)” shall be named as
an additional insured on RMI’s General Liability policy with respect to those activities
provided for in the Agreement.




Automobile Liability




     (including coverage for Hired and Non-Owned Automobiles)



Limit of Liability





Property Damage/Bodily Injury $2,000,000 Each Accident




Such coverage shall contain NO exclusion for loading and/or unloading of the
vehicles. RMI or Buckeye, as applicable, should be named as an additional insured with
respect to the transport of products by RMI or Buckeye as applicable.



Excess/Umbrella Coverage




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RMI shall provide Excess/Umbrella Insurance with limits not less than $5,000,000.



Insurance Certificate/Notice of Cancellation





The insurance coverage described above shall be confirmed by an insurance certificate
signed by the insurer or its authorized agent and providing that the certificate holder
shall be given at least 30 days prior notice of the cancellation of any of such coverage.




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